USA Dry Van Logistics emerges from bankruptcy

USA Dry Van Logistics, a national provider of asset-based transportation and third-party logistics focusing on cross-border shipments between the U.S. and Mexico, recently announced it emerged from bankruptcy after filing for it in February. Company officials said that USA Dry Van was successfully able to restructure the business and have the same customer base, employees, lenders, and equipment intact.

USA Dry Van Logistics, a national provider of asset-based transportation and third-party logistics focusing on cross-border shipments between the U.S. and Mexico, recently announced it emerged from bankruptcy after filing for it in February.

Company officials said that USA Dry Van was successfully able to restructure the business and have the same customer base, employees, lenders, and equipment intact. And they added that the company’s new owners are a conglomerate of lenders and shareholders led by GE Capital Corporation, CapitalOne, and FCC.

USA Dry Van’s new CEO is Dennis Reilly, whom formerly served as president of North American Transportation for OHL, and has also held positions with YRC Logistics, Menlo Logistics, CHEP USA and Frito Lay.

The main reason USA Dry Van entered into bankruptcy was that its debt was greater than its assets, said Reilly.

The company has roughly 500 tractors and drivers and 1,800 trailers and more than 250 customers and 650 employees. Instead of shutting the company down, its lenders and owners considered the company’s strong business model and niche in the marketplace as a transportation and logistics services provider for the Maquiladora industry and elected to work through the bankruptcy process, make the needed changes, and recoup their investments by growing the business.

“They felt very confident the business could run well if given a second chance,” said Reilly.

The main services USA Dry Van offers focuses on bringing freight into Mexico from the U.S. and take finished products out of Mexico. The company leverages several strong carrier relationships in Mexico, whom take USA Dry Van trailers loaded with product to Mexico-based plants, and then take loads of finished products in Laredo via an interchange at a terminal there and move full loads to the northeast, southwest, Midwest, and southern California regions of the U.S.

USA Dry Van’s corporate headquarters are located in McAllen, Texas, and the company has an office Monterey, Mexico and a small terminal in Dallas, Texas.

“We have several assets that we use on the U.S.-Mexico border, which is why a lot of companies tend to use us, because we have a great operation for moving freight both ways across the border,” said Reilly. “We fit that niche that a lot of people want to get into, as a lot of 3PLs are not as confident running cross-border shipments as they are doing it in just the U.S.”

The majority of USA Dry Van’s customers is U.S.-based and have manufacturing plants in Mexico, according to Andres Alejo, the company’s general manager. He added that the majority of the customer base is comprised of companies in the electronics and appliances sectors, as well as automotive.
CEO Reilly said that since the company filed for bankruptcy operations have been smooth, with the primary challenge for the company being able to attract and retain high quality drivers that can handle an average length of haul of 1,100-to-1,200 miles, with an average transit time of 2.7 days. Reilly said that empty miles make up about 7 percent of its total mileage and 80 percent of its loads pertain to Mexico-based hauls.

“We want to attract safe drivers that can help expand our business,” he said. “The day-to-day operations are run very well so we don’t expect any significant changes there.”

Along with dedicated cross-border freight transportation services, USA Dry Van has a 250,000 square-foot warehouse in McAllen to provide shippers with cross-docking and trans-loading, and basic warehousing services.

December 9, 2010

About the Author

Jeff Berman, Group News Editor

Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. Contact Jeff Berman

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